July 13 (Bloomberg) -- SAP AG, the business-software maker
ordered by a jury to pay $1.3 billion to Oracle Corp., told a
judge the verdict was based on speculation about Oracle’s losses
and should be cut to no more than $408 million.

A lawyer for SAP, Greg Lanier, said at a hearing today in
federal court in Oakland, California, that during a trial last
year Oracle overstated its losses from copyright infringement by
an SAP unit. SAP asked U.S. District Judge Phyllis Hamilton to
reduce the damage award or order a new trial because sustaining
the verdict would be a miscarriage of justice. Hamilton didn’t
rule today from the bench.

“I have not decided what I am going to do,” the judge
said.

Hamilton cautioned lawyers on both sides not to read too
much into a pretrial ruling denying SAP’s motion for summary
judgment. “I didn’t say Oracle was entitled to such damages. It
is still up to Oracle to present non-speculative evidence of
damages.”

Oracle, based in Redwood City, California, won a lawsuit in
November accusing SAP’s U.S.-based TomorrowNow software-maintenance unit of making hundreds of thousands of illegal
downloads and several thousand copies of Oracle’s software to
avoid paying licensing fees and to steal customers. The jury
award was the largest ever for copyright infringement.

Oracle maintained at trial that its damages should
represent the value of a hypothetical license that the unit
would have had to pay for the software it infringed.

Fierce Competitors

Such a license would never have existed between two fierce
competitors, so the damage award should have been based on
profits Oracle lost and SAP gained as a result of the
infringement, Walldorf, Germany-based SAP said in court filings.
That number is from $28 million to $407.8 million, SAP said in
the filings.

The damage award should stand, Oracle said in court
filings.

Geoffrey Howard, an attorney for Oracle, argued today that
SAP’s request to reduce the damages “would require the court to
reverse itself on motions it has made repeatedly and require the
court to weigh trial evidence” that was already decided by the
jury.

If a new trial is ordered, Hamilton should allow Oracle to
present evidence of its expected revenue from certain sales it
would have made if not for the infringement, something she
excluded from the case, Oracle said in filings. That would boost
the hypothetical license value by another $500 million, the
company said in the filings.

Willing to Negotiate?

At today’s hearing Hamilton asked the lawyers if they are
willing to negotiate a settlement. Lawyers for both sides said
they aren’t optimistic.

“It is not likely to be productive in the absence of a
ruling,” Lanier said. Howard said there have been no settlement
talks since the verdict.

Hamilton urged the lawyers to consider meeting with a
magistrate judge for negotiations, saying it will take her some
time to fashion a ruling.

The case is Oracle Corp. v SAP AG, 07-01658, U.S. District
Court, Northern District of California (Oakland).